Visa Inc. Fiscal First Quarter Financial Results February 6, 2013 Exhibit 99.2 |
Fiscal First Quarter 2013 Financial Results 2 Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by the terms "believe," "continue," “expect," and similar references to the future. Examples of such forward-looking statements include, but are not limited to, statements we make about revenues, client incentives, expenses, operating margin, tax rate, earnings per share, capital expenditures, free cash flow and the growth of those items. By their nature, forward-looking statements: (i) speak only as of the date they are made, (ii) are neither statements of historical fact nor guarantees of future performance and (iii) are subject to risks, uncertainties, assumptions and changes in circumstances that are difficult to predict or quantify. Therefore, actual results could differ materially and adversely from those forward-looking statements because of a variety of factors, including the following: • the impact of laws, regulations and marketplace barriers, including: • rules capping debit interchange reimbursement fees promulgated under the U.S. Wall Street Reform and Consumer Protection Act, or the Dodd-Frank Act; • rules under the Dodd-Frank Act expanding issuers' and merchants' choice among debit payment networks; • increased regulation outside the United States and in other product categories; • increased government support of national payment networks outside the United States; and • rules about consumer privacy and data use and security; • developments in litigation and government enforcement, including • those affecting interchange reimbursement fees, antitrust and tax and • our failure to make our multidistrict interchange litigation settlement effective; • economic factors, such as: • an increase or spread of the current European crisis involving sovereign debt and the euro; • a failure to raise the “debt ceiling” in the United States and its repercussions; • cross-border activity and currency exchange rates; • material changes in our clients' performance compared to our estimates; and • other global economic, political and health conditions; • industry developments, such as competitive pressure, rapid technological developments and disintermediation from the payments value stream; • system developments, such as: • disruption of our transaction processing systems or the inability to process transactions efficiently; • account data breaches or increased fraudulent or other illegal activities involving our cards; and • issues arising at Visa Europe, including failure to maintain interoperability between our systems; • costs arising if Visa Europe were to exercise its right to require us to acquire all of its outstanding stock; • loss of organizational effectiveness or key employees; • failure to integrate acquisitions successfully or to effectively launch new products and businesses; and the other factors discussed in our most recent Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission. You should not place undue reliance on such statements. Unless required to do so by law, we do not intend to update or revise any forward-looking statement, because of new information or future developments or otherwise. |
Fiscal First Quarter 2013 Financial Results 3 Solid Fiscal First Quarter Results • Strong operating revenues of $2.8 billion, up 12% over prior year • Quarterly net income of $1.3 billion, up 26%, and diluted earnings per share of $1.93, up 30% over prior year • Continued positive secular trends and spending momentum contributed to growth in key underlying business drivers • Repurchased 9 million shares of class A common stock in the open market at an average price of $145.40 per share, using $1.3 billion of cash on hand |
Fiscal First Quarter 2013 Financial Results 4 971 598 373 1,008 642 366 Total Visa Inc. Credit Debit 2011 2012 U.S. 517 ROW 454 U.S. 229 ROW 369 U.S. 521 ROW 487 U.S. 250 ROW 392 U.S. 271 ROW 95 U.S. 288 ROW 85 Payments Volume US$ in billions, nominal, except percentages YOY Change (nominal) 7% (2%) 4% YOY Change (constant) 6% 10% (0%) Note: Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. From time to time, previously submitted volume information may be updated. Prior period updates are not material. Constant dollar growth rates exclude the impact of foreign currency fluctuations against the U.S. dollar in measuring performance. ROW = Rest of World Quarter ended September |
Fiscal First Quarter 2013 Financial Results 5 993 616 378 1,075 687 388 Total Visa Inc. Credit Debit 2011 2012 U.S. 529 ROW 464 U.S. 237 ROW 379 U.S. 292 ROW 85 U.S. 544 ROW 531 U.S. 262 ROW 425 ROW106 U.S. 282 Payments Volume US$ in billions, nominal, except percentages YOY Change (nominal) 12% 3% 8% YOY Change (constant) 9% 12% 4% Note: Current quarter payments volume and other select metrics are provided in the operational performance data supplement to provide more recent operating data. Service revenues continue to be recognized based on payments volume in the prior quarter. From time to time, reported payments volume information may be updated to reflect revised client submissions or other adjustments. Prior period updates are not material. Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. ROW = Rest of World Quarter ended December |
Fiscal First Quarter 2013 Financial Results 6 Payments Volume US$ in billions, nominal, except percentages YOY Change (nominal) 6% 3% 1% 4% 27% YOY Change (constant) 1% 8% 4% 20% 36% Note: Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. From time to time, previously submitted volume information may be updated. Prior period updates are not material. Constant dollar growth rates exclude the impact of foreign currency fluctuations against the U.S. dollar in measuring performance. Quarter ended September 2011 2012 517 272 89 56 37 521 290 92 57 47 United States Asia Pacific Latin America and Caribbean Canada Central and Eastern Europe, Middle East and Africa |
Fiscal First Quarter 2013 Financial Results 7 Payments Volume US$ in billions, nominal, except percentages Note: Current quarter payments volume and other select metrics are provided in the operational performance data supplement to provide more recent operating data. Service revenues continue to be recognized based on payments volume in the prior quarter. From time to time, reported payments volume information may be updated to reflect revised client submissions or other adjustments. Prior period updates are not material. Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. YOY Change (nominal) 13% 11% 3% 12% 34% YOY Change (constant) 13% 7% 3% 22% 37% Quarter ended December 2011 2012 529 276 93 56 39 544 313 104 62 52 United States Asia Pacific Latin America and Caribbean Canada Central and Eastern Europe, Middle East and Africa |
Fiscal First Quarter 2013 Financial Results 8 Transactions in millions, except percentages Note: Processed transactions represent transactions involving Visa, Visa Electron, Interlink and Plus cards processed on Visa’s networks. Total transactions represent payments and cash transactions as reported by Visa clients on their operating certificates. From time to time, previously submitted transaction information may be updated. Prior period updates are not material. Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. YOY Change 6% 4% 2011 2012 Quarter ended December 20,348 13,600 21,553 14,159 Total Transactions Processed Transactions Credit 36% Debit 64% Credit 38% Debit 62% |
Fiscal First Quarter 2013 Financial Results 9 Total Cards in millions, except percentages YOY Change 12% 8% 2% Note: From time to time, previously submitted card information may be updated. Prior period updates are not material. Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. Quarter ended September 2011 2012 774 1,157 1,930 788 1,293 2,081 Credit Debit Visa Inc. |
Fiscal First Quarter 2013 Financial Results 10 Revenue – Q1 2013 US$ in millions, except percentages YOY Change 15% 12% 12% Note: Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. FY13 % of Gross Revenues 16% 84% 3,028 (481) 2,547 3,399 (553) 2,846 Gross Revenues Incentives Net Operating Revenues Fiscal 2012 Fiscal 2013 |
Fiscal First Quarter 2013 Financial Results 11 Revenue Detail – Q1 2013 US$ in millions, except percentages Note: Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. YOY Change 17% 8% 13% 1% Fiscal 2012 Fiscal 2013 1,151 951 748 178 1,300 1,115 805 179 Service Revenues Data Processing Revenues International Transaction Revenues Other Revenues |
Fiscal First Quarter 2013 Financial Results 12 Operating Margin – Q1 2013 US$ in millions, except percentages Note: Operating margin is calculated as operating income divided by total operating revenues. Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. YOY Change 13% 11% 12% (1 ppt) Fiscal 2012 Fiscal 2013 2,547 929 1,618 64% 2,846 1,046 1,800 63% Net Operating Revenues Total Operating Expenses Operating Income Operating Margin |
Fiscal First Quarter 2013 Financial Results 13 Operating Expenses – Q1 2013 US$ in millions, except percentages Note: Figures may not recalculate exactly due to rounding. Percentage changes calculated based on whole numbers, not the rounded numbers presented. YOY Change 12% 25% 17% 4% 16% 2% NM Fiscal 2012 Fiscal 2013 389 190 98 70 80 102 0 454 193 110 88 92 106 3 Personnel Marketing Network & Professional Fees Depreciation & General & Litigation Provision Administrative Amortization Processing |
Fiscal First Quarter 2013 Financial Results 14 Other Financial Results • Cash, cash equivalents and available-for-sale investment securities of $6.1 billion at the end of the fiscal first quarter • Free cash flow of $1.6 billion for the fiscal first quarter • Capital expenditures of $100 million during the fiscal first quarter • During the quarter we made payments totaling $4.4 billion in connection with the covered litigation. These payments will enable us to deduct these amounts in our fiscal 2013 U.S. income tax returns, increasing free cash flow for the year. This is reflected on our balance sheet at December 31, 2012 as a reclassification of $1.6 billion from deferred tax assets to income tax receivable. |
Fiscal First Quarter 2013 Financial Results 15 Under $1 billion Marketing expenses Financial Metrics for Fiscal Year 2013 Annual operating margin About 60% 18% to 18.5% range Client incentives as % of gross revenues Annual net revenue growth Low double digits |
Fiscal First Quarter 2013 Financial Results 16 $425 million to $475 million range Capital expenditures Financial Metrics for Fiscal Year 2013 Annual free cash flow About $6 billion High teens Adjusted annual diluted class A common stock earnings per share growth Tax rate 30% to 32% range |
Appendix Reconciliation of Non-GAAP Measures |
Fiscal First Quarter 2013 Financial Results Calculation of Free Cash Flow US$ in millions A1 (1) Includes changes in client incentives, trade receivable/payable, settlement receivable/payable, and personnel incentives. Additions (+) / Reductions (-) to Net income attributable to Visa Inc. Net income attributable to Visa Inc. (as reported) 1,293 Capital Assets + Depreciation and amortization 92 - Capital expenditures (100) (8) Litigation + Litigation provision 3 - Settlement payments (4,384) + Settlement payments funded by litigation escrow 4,383 2 Share-based Compensation + Share-based compensation 48 Pension + Pension expense 7 - Pension contribution - 7 Taxes + Income tax provision 508 - Income taxes paid (45) 463 Changes in Working Capital +/- Changes in other working capital accounts (255) Total Free Cash Flow 1,550 Three Months Ended December 31, 2012 (1) |